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Treasurys pare losses on Fed Beige Book

Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
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US 2-YR
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US 5-YR
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US 10-YR
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US 30-YR
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U.S. Treasurys pared losses on Wednesday after the Federal Reserve said U.S. economic activity continued to expand in October and November, with lower gasoline prices boosting consumer spending, on Wednesday.

Yields on benchmark 10-year Treasury notes—used to calculate mortgage rates and other consumer loans—read 2.29 percent, down flat in price.

The 30-year Treasury bond jumped 8/32 in price to yield 3.00 percent.

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The Institute of Supply Management said its services index rose hit 59.3 in November, just below the post-recession high of 59.6 it touched in August, from 57.1 in October. Analysts were expecting a reading of 57.5, according to a Reuters poll.

Treasurys rose earlier after a report showed nonfarm productivity grew a bit faster than initially thought in the third quarter, while sharp downward revisions to compensation pointed to muted wage inflation that should give the Fed room to keep interest rates low for a while.

Separately, the ADP report on private payrolls showed that the U.S. private sector created 208,000 jobs in November, below expectations.

Treasury prices had weakened across the curve on Tuesday, in what was a boon day for riskier assets.

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Federal Reserve Governor Lael Brainard will host a seminar on financial stability at the Brookings Institution in Washington DC. Philly Fed President Charles Plosser will speak at the Charlotte Economics Club on monetary policy and the outlook for growth, inflation and employment.

Higher oil prices boosted investor risk sentiment on Wednesday. U.S. oil and Brent crude both rebounded nearly $1, after an extremely volatile week.

There was also some good news out of Asia, where China's official non-manufacturing PMI figure rose to 53.9 in November, a touch higher than October's nine-month low of 53.8. However, business activity in the euro zone was shown at a 16-month low last month, confirming fears the region's fledgling recovery is faltering.

Reuters contributed to this report.